E57: Understanding Omicron, tech stocks plummet, VC's great resignation, Jack Dorsey's departure

Evidence from late 2021–early 2022 shows that Omicron spread globally and became dominant within weeks to a few months of its identification, matching Friedberg’s prediction.

• The WHO reported on 18 December 2021 that Omicron had been detected in 89 countries and that “the number of Omicron cases doubles in 1.5 to 3 days in places with community transmission”, noting it was spreading rapidly even in countries with high vaccination levels.
• By early January 2022, the U.S. CDC reported that Omicron had become the dominant variant in the United States, accounting for an estimated ~95% of new infections during the week ending 1 January 2022.
• Similar reports from the UK and other regions in December 2021–January 2022 showed Omicron quickly displacing Delta and becoming the predominant strain.

These data show that from early December 2021 (podcast date) to January 2022 (roughly 4–8 weeks), Omicron spread worldwide and became widespread in many regions, in line with the prediction that it would be “everywhere fast” and highly transmissible.

Most subsequent epidemiological work found that Omicron’s intrinsic transmissibility (often expressed via R0 or related measures) was substantially higher than Delta’s and plausibly in the high‑single‑ to low‑double‑digit range, consistent with Friedberg’s core claim.

Key points:

• Delta vs Omicron relative transmissibility: Early UK and Danish analyses found Omicron had a substantial growth advantage over Delta that could not be explained purely by immune escape. UKHSA and ECDC reports from late 2021–early 2022 estimated a transmission advantage on the order of ~2–3x over Delta, meaning Omicron’s effective reproduction number was much higher wherever both circulated.
• Published R0-like estimates:
  • A 2022 modeling study in Frontiers in Public Health estimated the basic reproduction number of Omicron BA.1 at ~9–10 in certain settings, compared with much lower values previously attributed to ancestral SARS‑CoV‑2 and Delta (typically ~5–7 for Delta in similar models).
  • Other modeling work and reviews (e.g., in The Lancet Infectious Diseases and Nature Reviews Microbiology) consistently described Omicron as the most transmissible variant to date, often highlighting that its intrinsic transmissibility was markedly higher than Delta’s, even after adjusting for immune escape.
• Context on very high values (e.g., 40): Some early, informal estimates or back‑of‑the‑envelope calculations suggested extremely high R0 values (20–40+) for Omicron, but these were not borne out as consensus values in the peer‑reviewed literature. However, Friedberg explicitly framed those as speculative and then anchored his actual prediction as “more likely…somewhere between 7 and 20,” which is in line with later modeling that put Omicron’s R0 around the upper end of that range and clearly above Delta.

Because (1) later analyses support that Omicron’s R0/equivalent transmissibility metric is substantially higher than Delta’s, and (2) numeric estimates in several models land in or near his 7–20 band rather than contradicting it, the prediction is best classified as right in substance, even if the very highest informal figures (R0≈40) did not become the consensus.

The episode was released 4 December 2021, so Friedberg’s two‑week window runs to roughly 18 December 2021. His claim was that by then “we’ll know … whether this actually changes hospitalizations,” i.e., that the impact of Omicron on hospitalization rates would be clearly established.

What actually happened:

• Early South African hospital data (first half of December) – Reports from a major hospital complex in Tshwane (Gauteng) covering admissions 14–29 November showed many incidental COVID findings, relatively few patients needing oxygen, shorter stays, and a lower in‑hospital fatality rate than prior waves, but explicitly stressed these were initial findings and that “it will take another two weeks” before more precise conclusions about disease severity could be drawn.(covidactuaries.org)
• Discovery Health actuarial analysis (14 December 2021) – Discovery Health reported a roughly 29% lower risk of hospital admission in the Omicron‑driven wave compared with South Africa’s first wave, but framed these results as preliminary, derived from only the first three weeks of the Omicron wave, and confounded by high prior immunity and other factors.(discovery.co.za)
• South African Health Ministry briefing (mid‑December) – Health Minister Joe Phaahla cited early national data indicating that only about 1.7% of identified Omicron cases had been hospitalized in the early phase of the wave, versus about 19% at a comparable point in the Delta wave, suggesting much lower observed hospitalization rates—but again presented this as early evidence from a young, highly immune population, not yet a definitive global answer.(businessinsider.nl)

At the same time, major public‑health authorities were still saying the hospitalization impact was unclear:

• On 8 December, the WHO Director‑General stated that while there was some evidence Omicron might cause milder disease, “it’s still too early to be definitive” and warned against drawing firm conclusions until more complete data were available.(who.int)
• A UK SPI‑M‑O consensus statement dated 15 December 2021 explicitly concluded that “there currently remains no strong evidence that Omicron infections are either more or less severe than Delta infections” and noted that “the hospital impact of Omicron cases is yet to be seen.”(gov.uk)
• More formal comparative‑severity analyses, such as the South African NICD’s early assessment and subsequent UK studies, were published around 21 December and later—after Friedberg’s two‑week horizon—and still emphasized substantial uncertainty around exact hospitalization risk reductions, even though they increasingly pointed toward lower severity.(gov.uk)

So by mid‑December 2021 there was emerging hospitalization data from South Africa and some preliminary analyses suggesting reduced severity, but leading scientific and policy bodies were explicitly saying the effect on hospitalizations was not yet clearly established and more time was needed. In other words, the data within two weeks were suggestive, not decisively clarifying in the way Friedberg forecast.

Because his prediction was specifically about having clear knowledge within that two‑week window—and the expert consensus at that time was that severity and hospitalization impact were still uncertain—this forecast is best judged wrong on its stated timeline.

Evidence since late 2021 shows a mixed picture on severity but clearly contradicts the idea that Omicron was a “nothing burger” that wouldn’t materially worsen the crisis relative to Delta.

On per‑infection severity, multiple large studies (e.g., Kaiser Permanente Southern California, CDC/California analyses) found Omicron infections were substantially less likely than Delta to lead to hospitalization, ICU admission, or death, and were associated with shorter hospital stays. Estimates include ~40–50% lower hospitalization risk and ~70–90% lower risk of death versus Delta, with shorter median length of stay. (kp-scalresearch.org) Some hospital-based cohorts, however, found that once hospitalized, Omicron and Delta patients often required similar levels of intensive care and respiratory support. (hopkinsmedicine.org) So Omicron was not more virulent than Delta; if anything, it was somewhat less virulent.

But Chamath’s stronger claim—that Omicron would not significantly worsen health‑system impact or the overall COVID crisis relative to Delta—is refuted by population-level data:

• CDC COVID‑NET data show that during Omicron predominance (January 2022), weekly adult hospitalization rates in the U.S. peaked at 38.4 per 100,000, exceeding both the prior winter 2020–21 peak (26.1) and the Delta peak (15.5). (pmc.ncbi.nlm.nih.gov)
• A CDC analysis of national trends concluded that the Omicron wave produced the highest numbers of COVID‑19–associated ER visits and hospital admissions since the start of the pandemic, explicitly noting that this surge strained the health‑care system, even though severity per case was lower. (cdc.gov)
• National hospitalization censuses during early January 2022 reached record levels, surpassing the previous U.S. peak from January 2021, with over 132,000–147,000 people hospitalized with COVID‑19 as Omicron spread. (anews.com.tr)
• CDC data comparing peaks show that during the Omicron wave, average daily cases (~799,000) and daily hospital admissions (~21,600) far exceeded the Delta wave’s daily cases (~164,000) and admissions (~12,000), even though deaths at the Omicron peak (~1,850/day) were somewhat lower than at earlier waves. The CDC explicitly warned that the high volume of hospitalizations could strain health systems, despite lower per‑case severity. (upi.com)

In other words:

• Biologically, Omicron was generally less severe than Delta on a per-case basis.
• System-wide, its extreme transmissibility and immune escape drove record case counts and record or near-record hospital burdens, clearly worsening stress on health systems relative to the Delta wave.

Because the prediction bundled both claims—downplaying danger and asserting that Omicron would not materially worsen the COVID‑19 crisis relative to Delta—the overall forecast that it was a “complete … nothing burger” is wrong.

Available evidence supports the normalized prediction that Omicron did not produce a major new upward step-change in either COVID-19 severity or societal disruption beyond earlier waves. Clinically, multiple studies comparing Omicron to Delta found substantially lower risks of severe outcomes: large cohorts from Kaiser Permanente and other health systems show Omicron infections had markedly reduced hospitalisation, ICU admission, and mortality compared with Delta, with shorter hospital stays and lower need for ventilation, indicating attenuation of severity rather than a worse variant. (about.kaiserpermanente.org) Reviews of variant evolution likewise describe Omicron as the most transmissible lineage but generally causing less severe disease, especially due to its shift toward upper‑airway infection instead of the lung-dominant pattern seen with pre‑Omicron variants. (pmc.ncbi.nlm.nih.gov) Societally, the initial Omicron wave in late 2021–early 2022 did drive record case counts and caused notable short-term disruptions such as widespread staff shortages and thousands of flight cancellations, but these disruptions occurred against the backdrop of an already ongoing, highly disruptive pandemic and were not clearly greater in scale than the lockdowns, border closures, and systemic shutdowns of 2020–early 2021. (axios.com) In many countries, major legal restrictions actually began to be relaxed as Omicron became dominant, even while cases hit record highs, and over the following years COVID-19 has moved toward a more endemic pattern with the WHO ending the formal global health emergency in 2023. (lemonde.fr) Omicron and its descendants did become the globally predominant lineage and were epidemiologically important, but they did not create a qualitatively worse phase of severity or societal upheaval beyond what earlier variants and the original strain had already produced, so the prediction as normalized is best judged as right.

Evidence since late 2021 supports Friedberg’s prediction on both parts:

1. Ongoing evolution with new notable variants
   After Omicron’s emergence in late 2021, SARS‑CoV‑2 has continued to generate notable new subvariants and lineages: Omicron sublineages such as BA.2.75, BF.7, BQ.1, XBB, XBB.1.5, EG.5, JN.1, and newer variants under monitoring (e.g., NB.1.8.1, LF.7 reported in 2025) have been documented over 2022–2025. These are tracked by WHO and genomic surveillance networks, demonstrating ongoing evolutionary change and repeated emergence of notable variants over time rather than the virus stabilizing or disappearing.(en.wikipedia.org)(journals.lww.com)(timesofindia.indiatimes.com) While the cadence is more frequent than once per year, the core claim that variants would keep emerging (rather than the virus fading away) has clearly held.

2. Endemic, ongoing disease rather than eradication
   In May 2023, WHO declared that COVID‑19 no longer constitutes a Public Health Emergency of International Concern and is now an “established and ongoing health issue,” signaling a shift to long‑term management rather than eradication efforts.(paho.org)(who.int) WHO Europe explicitly notes the virus is likely to remain for many years, “if not forever,” consistent with endemic circulation.(who.int) CDC’s 2025 respiratory virus guidance states that COVID‑19 is no longer the acute emergency it once was and that its health impacts now increasingly resemble other respiratory viral illnesses such as influenza and RSV, justifying unified guidance for these seasonal respiratory viruses.(cdc.gov)(cdc.gov) Independent reporting and expert commentary similarly describe COVID‑19 as having become a more routine, seasonal‑like respiratory infection in many countries, with patterns comparable to flu and RSV, though still more severe for high‑risk groups.(washingtonpost.com)(lemonde.fr) No credible source suggests SARS‑CoV‑2 has been eradicated or is on track for eradication.

Given (a) continuing appearance of new, noteworthy variants and (b) the broad scientific and public‑health consensus that COVID‑19 has transitioned into an ongoing, often seasonal respiratory virus rather than being eradicated, Friedberg’s prediction is substantively correct. The only minor mismatch is that variant emergence has been more frequent than “every year,” but that does not undercut the directional accuracy of the forecast.

Lockdowns:

• Comprehensive tallies of U.S. state responses show that formal statewide stay‑at‑home orders were a 2020 phenomenon, with end dates in spring 2020; the tables list no new statewide stay‑at‑home orders being imposed after those were lifted, and there is no entry indicating new stay‑at‑home mandates during the late‑2021/early‑2022 Omicron wave. This includes large states such as California, whose mandatory statewide stay‑at‑home order ended January 25, 2021 and was replaced by a reopening framework rather than reimposed later. 【2search12】2search13】2search14】
• Analyses of the Omicron wave note that, despite very rapid and widespread transmission from December 2021 through February 2022, the U.S. did not pursue a stringent zero‑COVID strategy based on broad lockdowns, instead relying on tools like vaccination, masking, and testing. 【1search2】
• Federally, President Biden said as Omicron emerged that he did not anticipate reinstating U.S. “shutdowns or lockdowns,” framing Omicron as a “cause for concern, not a cause for panic,” and emphasizing vaccines, boosters, and masks instead. White House statements around this time likewise stressed that with available tools, there was “no need for lockdowns.” 【4search1】4search3】2search0】
• At the state level, governors in both Democratic and Republican states publicly rejected new lockdowns during the Omicron surge; for example, Maryland’s governor anticipated a severe hospitalization surge but explicitly said he was not considering a lockdown and criticized large‑scale school shutdowns. 【4search2】

Taken together, available evidence indicates that after Omicron’s emergence in late 2021, U.S. states did not return to broad, state‑level stay‑at‑home orders analogous to March–April 2020.

Schools:

• Policy summaries and state chronologies for the Omicron period describe targeted, short‑term shifts to remote learning driven by local staffing and case spikes, rather than new blanket state orders closing all K–12 schools. For instance, Pennsylvania’s record notes that in January 2022 “many schools temporarily switched to virtual learning” due to Omicron‑driven cases among students and staff, but this is described as the result of local decisions, not a renewed statewide closure mandate. 【4search12】
• City‑level accounts show similar patterns: Philadelphia’s district temporarily moved 81 schools online for staffing reasons in early January 2022, while maintaining in‑person instruction elsewhere in the district, again without a state‑ordered, system‑wide shutdown. 【5search17】
• Major states’ Omicron‑era guidance (e.g., Illinois) focused on updating mitigation protocols specifically to maintain in‑person learning rather than to close schools; guidance from state education and health agencies in January 2022 framed testing, isolation rules, and masking as tools to keep classrooms open. 【5search1】
• New York City’s January 2022 response similarly expanded school testing and changed quarantine rules so that exposed classmates could remain in school with negative tests, explicitly avoiding a shift back to full remote learning. 【5search16】

There were localized and sometimes large district‑level closures (Chicago, parts of Philadelphia, various districts in multiple states), but they were temporary, fragmented, and not imposed as broad state‑level shutdowns of K–12 systems. At the same time, federal and state rhetoric consistently emphasized keeping schools open with mitigation rather than returning to 2020‑style closures.

Assessment relative to the normalized prediction:

• The user’s normalized version interprets Sacks as predicting that, after Omicron emerged in late 2021, the U.S. would not see a return to broad statewide stay‑at‑home lockdowns or widespread, state‑mandated K–12 school closures, even if Omicron spread widely.
• The historical record through late 2025 supports that characterization: Omicron produced a very large wave, but it did not trigger new statewide stay‑at‑home orders, nor did states generally re‑close their entire K–12 systems by mandate; instead, there were local, temporary, and often district‑specific shifts to remote learning.

Under that normalized, aggregate reading, Sacks’s prediction about U.S. policy response to Omicron is right. A literal reading (“no school closures anywhere”) would be false, but given the clarified scope—broad, state‑level lockdowns and closures—the prediction matches what actually happened.

Available retrospective evidence and mainstream public discourse do not line up with Sacks’s prediction that Omicron-era hindsight would show that lockdowns “didn’t work at all,” or that broad lockdowns were largely ineffective and only delayed, rather than prevented, harm.

1. Empirical studies generally find non‑trivial effects of lockdown‑type measures. Multiple observational studies in the U.S. report that stay‑at‑home orders reduced COVID‑19 case growth and deaths, with statistically significant declines in incidence and mortality while orders were in force.(pubmed.ncbi.nlm.nih.gov) Analyses of European non‑pharmaceutical interventions likewise conclude that partial or full lockdowns, together with school closures and travel restrictions, reduced cases and deaths compared with counterfactual scenarios without such measures.(archpublichealth.biomedcentral.com) Summaries of the literature (e.g., the COVID‑19 lockdowns and Non‑pharmaceutical intervention overview articles) characterize lockdowns as somewhat effective for reducing transmission and deaths, especially when implemented early and stringently, not as ineffective.(en.wikipedia.org)

2. Meta‑analysis critical of lockdowns still finds they did reduce mortality, and its conclusions are contested. The high‑profile meta‑analysis by Herby, Jonung and Hanke (now in Public Choice) finds that spring‑2020 lockdowns in Europe and the U.S. reduced COVID‑19 mortality by roughly 3–10.7%, thousands to tens of thousands of deaths, and argues that these health benefits were small relative to the economic and social costs.(link.springer.com) That paper has been heavily criticized by epidemiologists and fact‑checking outlets for methodology and interpretation, and is treated as one viewpoint in an ongoing debate rather than a new consensus that “lockdowns didn’t work.”(theguardian.com)

3. Official retrospective inquiries and mainstream expert commentary generally affirm that lockdowns saved lives, while acknowledging they mainly ‘bought time’ and had serious harms. The 2025 UK Covid‑19 Inquiry report—one of the most prominent post‑hoc assessments—concludes that national lockdowns “undoubtedly saved lives” and estimates that locking down about a week earlier in March 2020 could have reduced first‑wave deaths in England by nearly half, on the order of 23,000 lives.(thetimes.com) UK scientists and reviews similarly argue that, despite major social and health costs and limited certainty over exact effect sizes, early, shorter, better‑targeted lockdowns and other NPIs did reduce transmission and mortality, and they call for “smarter” alternatives in future pandemics—not because lockdowns failed entirely, but because they were a blunt, costly tool.(theguardian.com)

4. Public discourse after Omicron is mixed and polarized, not uniformly aligned with ‘lockdowns didn’t work at all.’ There is a strong anti‑lockdown current—economists and commentators arguing that benefits were small and costs large, often amplifying the Herby et al. findings.(fortune.com) But substantial expert and media commentary across the political spectrum frames lockdowns as having bought time for health‑system preparedness and vaccines and as reducing deaths, especially in early waves, while criticizing their collateral damage and late or poorly designed implementation.(en.wikipedia.org) That is not the same as an emerging consensus that they were broadly ineffective.

Taken together, the post‑Omicron evidence and discourse support a more nuanced position: lockdowns and similar restrictions were effective but costly and blunt, with effects that were often to delay and reduce rather than to permanently prevent spread. Sacks’s stronger prediction—that retrospective analysis would broadly conclude lockdowns “didn’t work at all” or were largely ineffective—is not borne out, so this prediction is best judged wrong.

Evidence suggests that some logistics elements of the supply chain (notably ocean freight) had largely normalized by late 2022, but broader global supply chain disruptions and their consumer‑level effects were not mostly worked through by then.

• On the positive side for the prediction, container shipping spot rates had undergone a “big unwind” by the end of 2022: FreightWaves reported that by the last week of December 2022, spot container rates and the spread between Asia–East Coast and Asia–West Coast routes had fallen back close to pre‑COVID norms, indicating that port congestion and freight pricing distortions were largely normalizing. (freightwaves.com)
• However, the New York Fed’s Global Supply Chain Pressure Index (GSCPI)—a composite measure of global transport costs and manufacturing bottlenecks—shows that while pressures peaked at over 4 standard deviations above normal in late 2021, they were still about 1.3 standard deviations above their historical average in December 2022, i.e., notably elevated rather than “normal.” (libertystreeteconomics.newyorkfed.org)
• More broadly, the episode is commonly characterized as the “2021–2023 global supply chain crisis,” with major sources describing material disruptions and knock‑on effects extending into 2023 (e.g., aircraft backlogs and various product shortages), which implies that the crisis was not considered resolved by the end of 2022. (en.wikipedia.org)
• Critically, upstream component shortages—especially semiconductors—continued beyond 2022. The global chip shortage is dated 2020–2023, affecting over 169 industries, and J.P. Morgan Research in April 2023 still expected some chip shortages to persist through 2023 and into 2024, meaning key input constraints and their pricing effects were still feeding through to end products well after 2022. (en.wikipedia.org)

Taken together, ocean freight and port bottlenecks had largely eased by late 2022, but overall global supply chain pressures were still clearly above normal, and major input shortages and related pricing distortions were still impacting consumers into 2023. That contradicts the prediction that the "supply chain glut and mismatch" would have largely normalized and been "worked all the way through to the consumer" by the end of 2022.

Available data show that Chamath’s core claim—that the inflation surge beginning in 2021 would be persistent, staying clearly above the Fed’s 2% target for several years and causing a multi‑year period of economic strain—has largely played out.

1. Persistence of above‑target inflation

• U.S. annual CPI inflation was about 4.7% in 2021, 8.0% in 2022, 4.1% in 2023, and roughly 3.0–3.2% in 2024, with 2025 year‑to‑date still near 3%, all notably above 2%. (theworlddata.com)
• The Fed’s preferred measure, core PCE inflation, ran well above 2% from early 2021 through at least mid‑2025, only drifting into the mid‑2s in 2024–2025 (e.g., 5.3% at end‑2021, 4.7–5.1% through 2022, around 4% in much of 2023, and still about 2.6–2.9% in 2024–2025). (ycharts.com)
• The Fed’s formal projections in late 2023 anticipated core PCE only reaching the 2% target around 2026, implicitly acknowledging that inflation would remain above target for several years beyond 2021. (cnbc.com)

From the time of his December 2021 statement through at least late 2025, U.S. inflation has indeed stayed persistently above the 2% target for roughly four years and counting, matching the “here to last”/“few years” characterization.

2. “A few years of pain” / economic difficulty

• High inflation eroded real wages and forced the Fed into rapid rate hikes from 2022 onward, which in turn made borrowing “far more expensive for consumers and businesses” and was described as “a significant burden for America’s consumers” over more than two years. (republicanleader.senate.gov)
• By 2025, the cumulative effect on living costs is large: relative to pre‑COVID levels, 2019–2025 price comparisons show housing, rents, vehicles, food, and insurance all up on the order of 20–50%+, indicating a sustained cost‑of‑living squeeze rather than a short, transitory bump. (theworlddata.com)

While the U.S. ultimately avoided a deep recession and the economy remained relatively resilient, the prolonged combination of elevated inflation, higher rates, and significantly higher household expenses is broadly consistent with the kind of multi‑year “pain” Chamath was warning about.

Because inflation did remain well above target for several years after 2021 and produced a sustained period of financial strain for households and borrowers, his prediction is best classified as right, acknowledging that the “pain” manifested more as a long cost‑of‑living squeeze and tight financial conditions than as a classic, severe recession.

Data from the U.S. Bureau of Labor Statistics and aggregators show that after 2020’s low inflation (about 1.2%), U.S. inflation moved to a clearly higher, multi‑year regime starting in 2021, rather than a brief spike:

• Average annual CPI inflation: 2021: 4.7%, 2022: 8.0%, 2023: 4.1%, 2024: 2.9%, 2025: 2.7% (through latest data). This is markedly above the ~1–2% range that prevailed for most of the 2010s. (usinflationcalculator.com)
• Other summaries of the U.S. economy report very similar figures: roughly 7.9% in 2022, 4.1% in 2023, 2.9% in 2024, 2.7% in 2025, confirming a multi‑year period of elevated inflation relative to the Fed’s 2% target. (en.wikipedia.org)
• The "2021–2023 inflation surge" overview likewise notes that inflation peaked at 9.1% in June 2022 and, while it declined, was still around 2.7% as of mid‑2025, with uncertainty about fully returning to target. (en.wikipedia.org)
• Separate analysis from large financial institutions shows U.S. PCE inflation peaking above 7% and only returning close to target (~2.1%) by late 2024, underscoring that the high‑inflation phase persisted for several years rather than fading quickly. (jpmorgan.com)

From the vantage point of late 2021, consensus policymakers frequently described inflation as “transitory,” expecting a fairly quick return to low rates. In reality, inflation stayed well above the prior‑decade norm for at least three full years (2021–2023) and only moved down toward target after aggressive monetary tightening, with levels in 2024–2025 still somewhat above the pre‑COVID pattern. (usinflationcalculator.com)

The causal mechanism Chamath emphasized (underinvestment and distorted work incentives) is harder to isolate empirically, but the core, testable part of his claim—that the U.S. would enter a multi‑year period of persistently higher inflation, not a short transitory blip beginning in 2021—is borne out by the data. Therefore, the prediction is best judged as right on the inflation path itself.

The prediction’s core elements were:

1. Inflation would not be merely “transitory” and would lead to higher interest rates.

   • U.S. CPI inflation surged to ~7–9% in 2021–2022 and stayed well above the Federal Reserve’s 2% target for multiple years, contradicting earlier official descriptions of inflation as “transitory.”
   • In response, the Federal Reserve raised the federal funds rate from near 0% in early 2022 to above 5% by 2023, the sharpest tightening cycle in decades. This clearly validates the direction of Sacks’s near-term claim that inflation would not be transitory and that it would create expectations of rising interest rates.
   • However, by 2024–2025, inflation had fallen substantially from its peak toward the low‑single‑digit range, and markets began to price in eventual rate cuts, suggesting inflation may not remain persistently high for the entire decade.

2. “The next decade may not be as good for growth stocks.” (≈2022–2031 vs. 2011–2020)

   • The 2011–2020 period was extraordinarily strong for U.S. growth/tech stocks: major growth indexes and the NASDAQ‑100 delivered very high annualized returns, substantially beating value stocks and broad market averages.
   • From 2022 through late 2025, growth stocks experienced a sharp drawdown in 2022 amid rate hikes, but then a powerful recovery, with large‑cap tech and AI‑related names delivering strong gains in 2023–2025. Many leading growth indexes and mega‑cap tech stocks were again near or at all‑time highs by 2024–2025.
   • However, the prediction is explicitly about the entire decade (~2022–2031) “may not be as good” as 2011–2020. As of November 30, 2025, less than half of that period has elapsed, and long‑horizon relative performance (over a full 10‑year span) cannot yet be measured. Growth’s strong rebound in 2023–2025 makes the ultimate decade‑long comparison especially uncertain.

Because:

• The duration and full‑decade impact of inflation/interest‑rate dynamics through 2031 are not yet observable; and
• The 10‑year performance of public‑market growth stocks from ~2022–2031 vs. 2011–2020 cannot be definitively evaluated in 2025,

it is too early to say whether the decade‑long prediction about growth stocks and the inflation regime is ultimately right or wrong.

Therefore, the correct status classification today is: inconclusive (too early to tell the full‑decade outcome).

The key elements of Sacks’s prediction all played out within a couple of years of late 2021:

1. Growth/tech stocks entered a clear bear market.

   • The Nasdaq Composite entered a bear market from November 2021 to December 2022, falling about 33% from its peak, its worst year since 2008. (nasdaq.com)
   • 2022 marked the first time the Nasdaq had four straight negative quarters since the dot‑com crash, with major tech names like Meta and Tesla losing roughly two‑thirds of their value and Amazon about half. (cnbc.com) This is exactly the “very different macro environment for growth stocks” he described.

2. Valuation multiples for growth/software companies materially compressed.

   • Public SaaS valuations peaked in 2021 around ~17x ARR, then fell roughly 35–40% by early 2022, with the median multiple dropping to ~10–11x. (saas-capital.com)
   • Broader software EV/Revenue multiples, which had surged to record levels in 2021, fell below 3x by late 2022 as rates rose and liquidity tightened, and by 2023–24 had “normalized well below their 2021 highs.” (aventis-advisors.com) This is consistent with “multiples and valuations are going to come down.”

3. Late‑stage private tech and VC portfolios saw major markdowns.

   • SoftBank’s Vision Fund, heavily concentrated in late‑stage tech, reported a record loss of about $27.4 billion for the year ended March 2022 due to plummeting valuations in its portfolio. (en.wikipedia.org)
   • Large crossover and growth investors like Tiger Global marked down their private portfolios by roughly a third in 2022, after their tech‑heavy hedge and long‑only books lost more than half their value. (swissinfo.ch)
   • PitchBook/NVCA analysis highlighted that late‑stage venture growth was the most overextended in 2020–21 and that, as public markets turned against high‑growth, high‑loss names, late‑stage companies faced funding gaps, increasing down‑rounds and failures in 2023. (gamesbeat.com) These are precisely the “mark‑downs” and painful reset he anticipated.

4. Founders and newer investors experienced the “rude awakening.”

   • Commentary on the post‑2021 “funding winter” notes that the second half of 2022 brought “a rude awakening for many entrepreneurs and investors alike,” as venture funding and deal counts collapsed from 2021 highs and startups faced layoffs, lower valuations and difficult fundraising. (unlistedintel.com)
   • Other investors described 2022’s environment of lower valuations, shutdowns, panic and layoffs as a reckoning after “exceptionally bloated” years, with many portfolios “heavily overvalued” going into the downturn. (forbes.com) This matches Sacks’s warning that younger founders and investors who’d never seen a real down cycle were “about to get a rude awakening.”

5. Timing check.
   The bear market in growth tech, multiple compression and VC markdowns began in earnest in early–mid 2022—well within “the next few years” after his December 2021 statement—and the effects on founders and investors were evident by late 2022–23.

While parts of tech (especially AI‑linked mega‑caps) later rebounded, the specific prediction—that growth stocks would soon face a harsher macro regime, with multiples and valuations falling and an ensuing shock to inexperienced founders and investors—was borne out by events.

Evidence since 2021 broadly matches all key elements of Friedberg’s prediction.

1. Pronounced ‘second act’ shift of successful tech investors into climate

• Chris Sacca is a textbook example: after running Lowercase Capital, one of the most successful early‑stage tech funds of the 2010s (Twitter, Uber, Instagram, Stripe), he retired from broad tech VC and now leads Lowercarbon Capital, described in 2025 conference materials as a fund pursuing ambitious climate solutions across energy, materials, transportation, food, etc. (sosvclimatetech.com)
• Former Meta CTO Mike Schroepfer, who achieved major financial and career success scaling Meta’s products and data centers, left the CTO role in 2022 explicitly to focus on climate investing and philanthropy via his climate‑focused VC firm Gigascale Capital and related entities. (en.wikipedia.org)
• New climate‑specific funds and strategies have been launched by existing, previously more generalist firms. For example, Collaborative Fund (founded 2010, historically a generalist early‑stage investor) launched its climate‑focused Shared Future Fund in 2022, and later raised a new flagship fund while highlighting climate technology as a core theme. (en.wikipedia.org)
• Industry overviews of VC partner moves explicitly cite the rise of climate tech as a magnet for experienced investors looking for new missions, framing this as part of a broader ‘second act’ trend in venture careers. (learnlater.com)
• A 2023 Venture Climate Alliance, including major generalist firms such as Tiger Global and Union Square Ventures, was formed to increase commitments to climate‑tech and align portfolios with net‑zero goals, signaling that mainstream tech VCs are formally adding climate to their remits. (reddit.com) Taken together, these do not mean most top 2010s VCs moved into climate, but they do show a visible, repeated pattern of highly successful tech investors and executives treating climate‑tech as a mission‑driven ‘second act’, just as Friedberg described.

2. Surge of capital into climate‑tech after 2021

• Global cleantech/climatetech investment boomed around and after 2021. One survey notes that in the 12 months to Q3 2022, climate‑tech accounted for more than a quarter of all venture dollars invested – a higher share than in most prior quarters. (en.wikipedia.org)
• A Financial Times analysis reports that dedicated climate‑tech VC hit about $48 billion at the 2021 peak and, even after market cooling, still totaled roughly $30 billion in 2024, outperforming the broader VC market where overall investment is down more than 50% from 2021. (ft.com)
• Numerous new or expanded climate funds have closed in this period despite tougher conditions, such as VoLo Earth’s second climate‑tech fund ($135m) and Planeteer Capital’s first‑time climate‑tech fund, which attracted notable tech and climate investors including former Meta CTO Mike Schroepfer. (wsj.com)
• At the same time, total VC has increasingly skewed toward AI by 2024 (roughly one‑third of all VC dollars), indicating that while AI is now dominant, climate‑tech still represents a large, distinct capital wave rather than a niche. (barrons.com) This clearly matches the prediction that there would be an ‘insane’ surge of funding into climate‑tech in the years following 2021.

3. Significant share of funded climate‑tech being uneconomic or failing commercially

• An Equal Ventures climate memo in 2025 explicitly describes a boom‑and‑bust pattern: generalist VCs poured into climate deals in 2022–23 at ‘astronomical’ prices and have since largely pulled back, leaving many of the very companies they had fervently backed, and characterizing that wave as ‘tourist capital’. (newsletter.equal.vc) This is essentially Friedberg’s scenario of non‑disciplined capital flowing into questionable climate businesses.
• The same FT piece on climate VC notes that the number of active climate investors has fallen for three consecutive years and that capital is consolidating around more specialized firms, consistent with many earlier climate bets proving weaker than hoped. (ft.com)
• Concrete climate‑tech examples illustrate overfunding and commercial failure:
  • Northvolt, heavily funded as Europe’s flagship EV‑battery champion, missed production targets by a wide margin, saw major customer contracts canceled, had a key expansion subsidiary file for bankruptcy in 2024, and struggled to secure rescue financing – cited as a case of ‘death by overfunding’ where enormous capital masked weak fundamentals. (linkedin.com)
  • Several high‑profile EV and green‑mobility startups once emblematic of the decarbonization boom (e.g., Nikola, Lordstown Motors) collapsed into bankruptcy after the 2020–21 hype cycle, despite prior multibillion‑dollar valuations. (polityka.co.pl)
  • Waste‑to‑methanol and gasification projects using Enerkem’s technology saw an Edmonton plant shut down a decade early and related projects in Canada enter financial distress, raising explicit questions in industry analysis about whether the technology is a failure rather than a viable climate solution. (linkedin.com)
  • The geoengineering startup Make Sunsets, funded by VCs to commercialize stratospheric aerosol injection via ‘cooling credits’, was forced to halt operations in Mexico after a government ban, illustrating how speculative, controversial models can rapidly hit regulatory and market walls. (eenews.net)
• Broader startup data show a sharp increase in shutdowns of VC‑backed companies that raised in the 2020–21 boom, with many failing due to lack of market need or unsustainable unit economics; climate‑tech is part of this broader pattern. (linkedin.com) These patterns are exactly what Friedberg anticipated when he warned of ‘insane’ funding into climate companies that ‘aren’t real businesses’ or rely on technologies that ‘will never work out’.

4. Overall assessment By late 2025:

• There has been a clearly identifiable wave of second‑career or ‘second act’ moves by high‑profile, financially successful tech investors and executives into climate‑tech investing and philanthropy.
• Climate‑tech experienced a large post‑2021 capital surge, becoming a major VC category before partially cooling.
• A meaningful subset of those climate‑related ventures have proven commercially weak or failed outright, and industry commentary now openly discusses overvaluation, tourist capital, and uneconomic projects in the climate‑tech boom.

The magnitude of the ‘second act’ trend may be somewhat smaller than his rhetorical ‘almost 100%’ phrasing suggests, and AI has since stolen some of the spotlight. But directionally and in its core claims, the prediction has played out as described. Hence the prediction is best judged as right.

Evidence since Jack Dorsey’s resignation indicates that Twitter/X’s overall approach to speech has become less restrictive, not more.

Key points:

1. Major rollback of COVID-19 moderation rules. Under Dorsey, Twitter removed ~97,000 pieces of COVID-19 misinformation and suspended over 11,000 accounts from 2020–Sept 2022 under a strict health-misinformation policy. After Elon Musk took over, Twitter announced on Nov 29, 2022 that it stopped enforcing this policy and would no longer label, demote, or remove COVID falsehoods. (time.com) This is a clear move toward less restrictive moderation.

2. Loosening protections against anti‑trans harassment. In early April 2023, Twitter quietly removed an explicit rule that prohibited targeted misgendering or deadnaming of transgender people—an anti‑abuse protection that had existed since 2018. (techcrunch.com) X later partially reinstated a narrower rule in 2024 that focuses mainly on repeated, targeted harassment and often just reduces visibility of offending posts rather than reliably removing them. (them.us) Net effect: weaker, not stronger, speech restrictions in this area.

3. Dissolution and downsizing of trust & safety infrastructure. After Musk’s acquisition, Twitter/X dissolved its Trust and Safety Council and leaned more heavily on automation while hate speech surged, a shift widely described as relaxing moderation. (en.wikipedia.org) Regulatory filings from Australia’s eSafety Commissioner and related reporting show X:

   • cut global trust & safety staff by ~30%, including 80% of safety engineers;
   • halved the full‑time content moderation team and significantly reduced contracted moderators;
   • became slower and less responsive to reports of hateful content. (apnews.com) These cuts reduce the platform’s actual capacity to restrict content compared to the Dorsey era.

4. Mass reinstatement of previously banned accounts. Musk explicitly pursued a “general amnesty” for suspended users, restoring accounts banned for COVID misinformation and other policy violations, and reinstating high‑profile accounts such as Donald Trump and Marjorie Taylor Greene. (cnbc.com) A wave of reversals of earlier enforcement decisions is inconsistent with a move toward more censorship.

5. Empirical studies describe moderation relaxation and more visible hate content. Academic work and monitoring organizations examining the post‑acquisition period conclude that Musk’s takeover was associated with relaxed moderation and substantial increases in hate speech on the platform (including anti‑LGBTQ and racist content). (montclair.edu) While increased hate speech doesn’t by itself prove there are fewer takedowns, these studies explicitly tie the surge to moderation being loosened, not tightened.

There is some evidence that X has been more willing to comply with certain state censorship demands (for example, account withholding by jurisdiction). (arxiv.org) But the prediction was broadly about Twitter’s own content‑moderation and speech restrictions being ramped up relative to Dorsey’s tenure. Given the large‑scale rollbacks of major policies, staff and structural cuts, and mass reinstatements, the dominant trend since late 2021 has been less restrictive speech moderation overall, so Sacks’s prediction that “things are only going to get worse” in the sense of more censorship is best judged as wrong.

Twitter did implement the expanded private media policy in late November 2021, shortly before this episode, stating it would remove photos and videos of private individuals shared without their consent, but with clear exceptions for public figures and public events like protests. Media or protest footage could generally remain online if it was newsworthy or in the public interest, and enforcement was complaint‑based rather than a blanket prior restriction. (washingtonpost.com)

After Elon Musk’s acquisition in October 2022, the overall direction of X (formerly Twitter) moved toward less restrictive moderation, not more. Studies and reporting describe X as continuing to host large amounts of graphic, misleading, and inflammatory content around riots and protests, contributing to concerns about misinformation rather than a lack of such footage. (en.wikipedia.org) This is the opposite of the scenario Friedberg envisioned where Twitter would effectively “eliminate” democratized access to riot/crime video through strict enforcement.

TikTok has indeed become a major venue for real‑time videos of conflicts, protests, and violence. Research and reporting note TikTok’s outsized role as a primary source of news and real‑time updates for many users, especially around the Israel–Gaza war, and document billions of views on war‑ and Palestine‑related hashtags. (forbes.com) There is also extensive evidence of TikTok being used to share primary‑source war footage such as Ukraine‑war videos. (reddit.com) However, this growth cannot be tied specifically to Twitter’s 2021 private‑media policy, and TikTok has not “soaked up this whole market” in the sense of displacing X as a primary place to watch riot/crime/protest clips; both platforms continue to host and amplify such content.

Because (1) Twitter’s policy never actually banned most public‑event footage in the way Friedberg feared, (2) enforcement under Musk moved toward looser, not stricter, control over such videos, and (3) although TikTok became very important for conflict and protest footage, it did not become the singular or clearly dominant destination for such content as a direct consequence of Twitter’s policy, the causal and market‑share prediction he made has not materialized. Hence the prediction is best judged as wrong.